Experts: N.C. Should Ride Out Recession
Posted March 17, 2008
Raleigh, N.C. — As the U.S. economy sinks into recession, North Carolina appears to be treading the turbulent economic waters better than most states, according to economic observers.
"We're going to participate in this recession. The point is, I think we're going to probably do better than many other states," said Mike Walden, an economist at North Carolina State University.
The housing and financial downturns hurt, Walden said, but he doesn't sense the volatility of other markets.
"Lenders are scared, and they want to make sure that, if they make loans, they're solid investments," he said. "We look good on the basis of that."
The current economic turmoil is different than in 2001, when the Internet stock bubble burst and many technology companies crashed, observers said.
Manufacturers also took a hit as the U.S. economy contracted seven years ago. Now, because of the weak dollar and increased exports, many manufacturers are holding their own, observers said.
"The way I've phrased it before is (that) we'll get skinned, but not killed," North Carolina Commissioner of Banks Joe Smith said. "We may have a slowdown, a slowness of earnings. Some loans will go bad, but we'll get through all that."
Smith said Charlotte-based Bank of America and Wachovia, two of the nation's largest banks, would likely be tighter with loans in the coming months, but would survive.
"Most of the events that we're seeing in the press ... do not relate to North Carolina-based institutions," he said.
Dan Moore, the owner of R.W. Moore, a Garner construction equipment dealer, said his family business has gotten through economic ups and downs for 45 years.
"If (the economy is) going up, we're going up. If it's going down, we're riding it down," Moore said.
Sales at R.W. Moore are down 10 to 15 percent, which Moore said is bad but not disastrous.
"We're starting to feel a little uncertainty in the market," he said. He added, however, "No matter what we're dealing with, its worse (elsewhere)."